Vail Daily column: New law affects homeowners associations

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I love writing this column. The Vail Daily allows me to share my sometimes esoteric perspective on the law and the legal profession with the community and I am very grateful for the opportunity. When this column started, one of the main goals was to change the public’s perception of attorneys. Another was to illuminate the shadowy world of the law in a way that was intriguing and not just a simple lecture. Informal response shows that progress is being made on those fronts. The same chats have revealed that one of the most popular Open Bar topics was the thorny issue of homeowners associations. Let us revisit that arena.

In a departure from my typically more general approach, I wanted to be the bearer of some specific practical news regarding homeowners associations. Whether you think this news is good or bad depends on several factors, including your stance on breadth of government and your occupation. If you have already heard this news, you are likely either a diligent homeowners association board member or you have a conscientious homeowners association attorney. For the rest of you, I continue. The Colorado General Assembly passed two new laws affecting homeowners associations whose effective dates are forthcoming. Two other laws were passed by the Legislature in this past session, but have already gone into effect and will not be discussed in detail here. However, to satisfy your curiosity, they concern xeriscaping and water conservation and expansion of the state’s office regulating homeowners associations.

The more controversial of the new bills (House Bill 13-1277) requires homeowners association managers (a term yet to be fully defined) to obtain licensure by the state of Colorado. The fine details of the law, including its accompanying rules and regulations, have yet to be ironed out as the bill does not become effective until Jan. 1, 2015. However, one known mandate is for homeowners association managers to take a course and pass an exam in order to continue to manage homeowners associations. To libertarians, this is likely viewed as an example of government overreaching. It will place additional burdens on homeowners associations and their management. However, the measure will also help protect both homeowners associations and their constituent homeowners from the sting of mismanagement, whether financial or otherwise. More education for and oversight of those responsible for maintaining communities should be viewed in a positive light and that was certainly the intent of the Legislature. Although homeowners association boards may be initially reluctant to assume these additional burdens, they will likely find that the measure reaps benefits for the homeowners association in the longer term.

The second bill (House Bill 13-1276) is generally considered to be a boon for and protection of homeowners. On the flip side, it imposes more stringent requirements on homeowners associations and is set to go into effect on Jan. 1. If homeowners associations want to be able to continue engaging in collections activities to recoup past due assessments and other charges through assessment liens or legal action, they will have to implement or amend their collection policy to meet the standards of the new law. Of particular note is a requirement that, a homeowner be able to enter into a payment plan to pay off their delinquency. Also required, is a more robust notice of delinquency from the homeowners association to the delinquent owner. This is a constructive step that increases the communication and transparency that I previously discussed as being so vital to successful governance of and membership in an homeowners association. There are further sensible provisions of the new law, including a requirement that an owner’s past due amount pass a certain threshold before an assessment lien is foreclosed and a more stringent procedure for authorizing legal action against an offending homeowner.

My intention in this column is not to go into exhaustive details about these laws, but simply to provide a general survey so that more information can be obtained. Homeowners association boards will have to do some work to make sure that they are in compliance, and that their homeowners associations continue to function as smoothly as possible. Homeowners association board members already volunteer so much of their time to help their communities, and these additional tasks will only serve to increase the value of their (usually great) work. Keep that in mind the next time you see a member of your homeowners association’s board. An expression of thanks and perhaps a hug of appropriate nature may be just the motivation to keep those board members plugging away.

T.J. Voboril is a partner with Thompson, Brownlee and Voboril LLC, a local civil litigation firm, and the owner and mediator at Voice of Reason Dispute Resolution. For more information, contact Voboril at 970-306-6456, email tj@thompsonbrownlee.com or visit www.thompsonbrownlee.com.

The measure will also help protect both homeowners associations and their constituent homeowners from the sting of mismanagement, whether financial or otherwise.